The primary reasons for providing an update to previous PEA studies on the Ixtaca Project are to show the impact of significantly reduced initial capital cost on project economics and to demonstrate the viability of an alternate mine plan which focuses on the near surface high grade limestone hosted portions of the Ixtaca Zone deposit. This alternate mine plan is a smaller high grade scenario that still allows for expansion into a larger production scenario as described in previous Ixtaca PEAs (see Almaden news releases of April 16th, 2014 and September 3rd, 2014). In addition, this PEA Update incorporates results from various engineering studies related to the project which have been conducted since the September 2014 PEA report. This PEA Update incorporates:

The same resource model as the maiden PEA;

The Rock Creek Mill with average throughput of 7,500 tonnes per day;

A smaller, near surface and payback focussed pit;

Mine production schedule which targets higher grades earlier;

Optimised waste placement and tailings management facilities;

A 2% NSR held by Almadex Minerals Limited (TSX VENTURE: AMZ).

This PEA UPDATE is preliminary in nature as it includes inferred mineral resources which are considered too speculative geologically to have the economic considerations applied that would enable them to be categorized as mineral reserves. There is no certainty that the PEA Update forecasts will be realized or that any of the resources will ever be upgraded to reserves. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.

J. D. Poliquin, Chairman of Almaden reported, "This PEA update shows material improvements to the potential economic viability of the Ixtaca project realised through the recently-optioned Rock Creek Mill. At the same time a new mine plan is presented that optimises the mine plan for the lower metal price environment we find ourselves in by focussing on the near surface, quicker payback material. We now continue working on a PFS to further de-risk the project and initiate the permitting process."

Geology and Mineral ResourcesThe Ixtaca deposit is an epithermal gold-silver deposit, mostly hosted by veins in limestone and shale basement rocks with a minor component of disseminated mineralisation hosted in overlying volcanic rocks. In the September 2014 PEA the limestone host rock comprised 73% of the metal produced, volcanic 19% and blackshale 8%. In this PEA Update limestone comprises 91% of the metal produced, volcanic 7% and blackshale 2% on a gold-equivalent basis using a 72:1 silver to gold ratio.

On January 31, 2013 the Company announced a maiden resource on the Ixtaca Zone. Since that time drilling has been focused on expanding and infilling the known resource base for this PEA which utilised the NI 43-101 Compliant Updated Mineral Resource Estimate released January 22, 2014, performed by Gary Giroux, P.Eng., qualified person under the meaning of NI 43-101, and summarised in Table 3 below. The data available for the resource estimation consisted of 423 drill holes assayed for gold and silver. The estimate was constrained by three dimensional solids representing different lithologic and mineralized domains. Of the total drill holes 400 intersected the mineralized solids and were used to make the resource estimate. Capping was completed to reduce the effect of outliers within each domain. Uniform down hole 3 meter composites were produced for each domain and used to produce semi-variograms for each variable. Grades were interpolated into blocks 10 x 10 x 5 meters in dimension by Ordinary kriging. Specific gravities were determined for each domain from drill core. Estimated blocks were classified as either Measured, Indicated or Inferred based on drill hole density and grade continuity. Wireframes constraining mineralised domains were constructed based on geologic boundaries defined by mineralisation intensity and host rock type. Higher grade zones occur where there is a greater density of epithermal veining. These higher grade domains have good continuity and are cohesive in nature.

MEASURED RESOURCE

AuEq Cut-off

Tonnes > Cut-off

Grade > Cut-off

Contained Metal x 1,000

(g/t)

(tonnes)

Au (g/t)

Ag (g/t)

AuEq (g/t)

Au (ozs)

Ag (ozs)

AuEq (ozs)

0.3

44,550,000

0.48

30.28

1.07

682

43,370

1,527

0.5

30,420,000

0.61

39.44

1.38

599

38,570

1,350

0.7

22,300,000

0.73

48.02

1.67

526

34,430

1,196

1.0

15,620,000

0.88

58.66

2.03

444

29,460

Subscribe to the RSD email list and get the latest resource stock activity directly to your inbox, for free.

Please enter a valid email address.

Subscribe to the RSD email list and get the latest resource stock activity directly to your inbox, for free.